WASHINGTON - For months, the US news
media, the attention of pundits and elected
officials have been riveted on the provocative
rhetoric of ultra-conservative Iranian President
Mahmud Ahmadinejad. President George W Bush in
particular has invoked Ahmadinejad's alleged drive
for nuclear weapons and desire to destroy Israel
to justify US isolation and pressure on the
regime.

But the almost exclusive focus on
Ahmadinejad has been misplaced, because all the
evidence indicates that it is Grand Ayatollah Ali
Khamenei, not Ahmadinejad, who is directing
Iranian foreign policy. Despite Ahmadinejad's
clever exploitation of the nuclear issue to
strengthen his domestic political position, he is
playing second fiddle on this issue.

Ahmadinejad "doesn't have much to do with
the nuclear

issue", David Albright of
the Institute for Science and International
Security in Washington, the
most experienced US non-governmental expert on
Iran's nuclear program, told Radio Free
Europe/Radio Liberty immediately after the Iranian
president's election. Albright observed that the
policy on Iran's nuclear program is run by the
Supreme National Security Council "directly under
the Supreme Leader" (Khamenei).

At a
briefing in Washington last week, Hadi Semati, a
professor at Tehran University who is now a
visiting fellow at the Woodrow Wilson Center for
Scholars, said Ahmadinejad "is third in command"
after Khamenei and the Supreme National Security
Council. Khamenei and the council, he said, "are
not going to let the president decide anything on
the nuclear issue".

The Supreme National
Security Council includes representatives
appointed by the Supreme Leader as well as top
officials from the military, foreign affairs,
intelligence and other national-security-related
agencies, including the Islamic Revolutionary
Guard Corps. It determines national-defense and
security policies on the basis of general
guidelines laid down by the Supreme Leader.

Khamenei has not hesitated to set the
record straight when Ahmadinejad has strayed from
the foreign-policy line he and the Supreme
National Security Council have set. Ten days after
Ahmadinejad declared in a speech last October 25
that Israel should be "wiped off the map",
Khamenei clarified Ahmadinejad's remarks,
declaring that Iran "will not commit aggression
against any nation. We will not breach any
nation's rights anywhere in the world."

By
shifting the focus from Ahmadinejad's provocative
speeches and rambling letter to Bush to the
thinking of Khamenei and his senior advisers, one
can see the outlines of a consistent and coherent
strategy toward the nuclear issue, the region and
relations with the United States. These men may
hold a theocratic perspective on Iranian politics
and social life, but they base their
national-security strategy on an assessment of
international power relations and their own
bargaining leverage.

Khamenei and the
Supreme National Security Council are keenly aware
that Iran must exist in a region in which US
military might is far superior to their own. But
they have long viewed negotiations with the United
States as the key to Iran's security, as well as
its re-emergence as a regional power.

They
have long pondered the question of when to
negotiate with Washington. When then president
Mohammad Khatemi proposed in an interview with CNN
in January 1998 to engage the US in a dialogue,
Khamenei responded several days later by
denouncing the idea of talks or of relations with
the United States.

But historian Shaul
Bakhash of George Mason University recalls that
one of the arguments Khamenei cited in the speech
against engaging the United States was that Iran
should not negotiate until it was in a stronger
position. Since that January 1998 speech, much has
happened to change Khamenei's perspective.

When the United States signaled that it
intended to overthrow Saddam Hussein and occupy
Iraq, Iranian leaders saw both danger and
opportunity. On one hand, they were concerned
about a possible US attack against Iran if it
could consolidate power over Iraq. But they also
reasoned that the United States would need their
help to stabilize the post-Hussein political
situation there, especially given Iran's special
relationships with militant Iraqi Shi'ite
political-military organizations that would
re-enter Iraq from their exile in Iran.

Iranian policymakers also knew that
Washington wanted their help on apprehending
al-Qaeda leaders who had been detained in Iran
after fleeing from Afghanistan. Even more
important was Washington's evident concern over
progress in Iran's nuclear research program by
late 2002.

The awareness of a changed
bargaining relationship opened a new stage of
Iranian diplomacy. The first effort to engage the
United States was the secret proposal of April
2003, conveyed to the State Department through the
Swiss ambassador in Tehran, which Bush chose to
ignore.

Khamenei and his advisers believe
Iran's leverage on US policy toward Iran has
actually increased since that failed initiative.
The United States has become hopelessly bogged
down in Iraq, and allies of Iran are in positions
of power in Iraq, Afghanistan and Palestine. And
most important of all, Washington is now in crisis
mode over Iran's uranium-enrichment program.

Those developments are shaping the views
of Iran's top policymakers about negotiations. The
best indication of Khamenei's current strategic
thinking is a recent statement by his top
foreign-policy adviser Ali Akbar Velayati, foreign
minister from 1981 to 1997. Velyati's closeness to
Khamenei is indicated by the fact that, when
Khamenei was president in 1981, Velyati was his
first choice as prime minister.

At a
seminar in Tehran on May 18, Velyati addressed the
evolution of Iran's bargaining position in
relation to the United States. "We have at no time
until now had such powerful means for haggling,"
he said, nor "the influence we have now in Iraq
and Palestine". He referred to friendly forces in
power or in key positions in neighboring Iraq and
Afghanistan.

Velyati drew the obvious
conclusion: "Now that we have the power to haggle,
why don't we haggle?" The word "haggle" suggests
bargaining over a Persian rug rather than
negotiations on international security issues. But
it conveys accurately the present mentality of the
Iranian leadership about negotiations over the
nuclear program.

Merchants "haggle" over
the price of the goods, and Khamenei and his
advisers are hoping to extract a high price from
the United States in regard to a new regional
order in return for guarantees against an Iranian
nuclear-weapons program and other concessions of
concern to the Bush administration.

The
secret Iranian proposal of 2003, which called for
US "recognition of Iran's legitimate security
interests in the region with according [that is,
concomitant] defense capacity", suggests what Iran
hopes to get from the haggling with Washington.
The regional order sought by Tehran would still
recognize the predominance of US power, but with
new limits.

The evidence suggests that the
realists who rule in Tehran are offering
Washington a transition to a new, more stable
Middle East in which Iran's role is more prominent
but also more consciously devoted to bringing
about change without violence. Up to now, however,
the Bush administration has not been willing to
accept any such limitation on its power.

Gareth Porter is a historian and
national-security policy analyst. His latest
book, Perils of Dominance: Imbalance of Power
and the Road to War in Vietnam, was published
in June 2005.